Going through a divorce can take a toll on your mental and emotional health. It’s not uncommon to struggle with grief over your loss and excess stress when it comes to what you’ll do next.
Another issue many people face following a divorce is financial struggles. Maybe you’re going from a two-person income to paying for everything on your own.
One of the best things you can do is to protect as much money as possible during your divorce. Try to work out an agreement with your ex that fits both of your needs. Of course, to do that, you’ll likely need to hire an experienced attorney, which can end up costing thousands.
Luckily, there are steps you can take after the divorce is finalized.
You can rebuild your finances and feel stable and secure again.
Let’s cover four solutions that can help you with that rebuilding process, so you can get back on your feet and experience financial security as quickly as possible.
1. Continue Your Education
Going back to school might not seem like the easiest thing in the world right now, but it could be the first step toward a better financial future.
Yes, most higher learning institutions cost money. However, there are plenty of programs that allow you to apply for financial aid, so don’t be afraid to do your research. Additionally, you can usually find more inexpensive courses by looking online and taking virtual classes. Other ways to make going back to school as an adult more affordable include:
- Looking for scholarships for adult learners;
- Applying for experiential learning credits from on-the-job training;
- Asking your current employer if they will cover some of the costs;
- Transferring previous credits and degrees.
Continuing your education or getting a higher degree can make it easier to move up in your current place of business or find a higher-paying job somewhere else. If you’re struggling with a single-person income for the first time in years, boosting it with a better degree and more educational experience can help to fill in the financial gaps of a second income.
2. Divide Your Assets
You might have agreed to certain financial and property divisions during your divorce. However, between the stress of everything and you trying to move on to the next chapter of your life, it’s easy to forget “little things” that can make a big difference to your financial health.
Make sure that your former spouse is no longer on any accounts that you hold. That includes checking and savings accounts, credit cards, and even retirement accounts. In most cases, you’ll have to close those joint accounts completely and open new ones solely in your name. Doing so will ensure your ex can’t take any of that money. Taking yourself off of your ex’s credit cards can also help to boost your credit and make it easier to take out low-interest loans in the future.
3. Create a New Budget
You likely had a budget in place when you were married that took two incomes into account. Now, as you’re living on your own, you’ll either need to adjust that budget or start a completely new one. This is a crucial step to healing yourself and your finances after divorce.
Start with realistic expectations. Don’t panic, and cut all of your expenses at once. Instead, take a look at where you’re currently spending the most money and which small expenses seem to add up quickly. Some of the first things you should consider cutting include:
- Dining out as frequently;
- Cleaning products;
- Car washes;
- New clothes;
- Cable/streaming services.
You might find that you can make swaps for the things you’re used to now to save a bit of money. For example, instead of buying a $5.00 latte at your favorite coffee shop, “splurge” on a gourmet creamer that you can use for a week or two. Small changes can make a big difference when you’re on a single, tight budget. Your budget should be flexible as your financial needs change. It won’t take long for you to discover what you really need each month to feel comfortable, and you can start to add in expenses little by little.
4. Start an Emergency Fund
If you didn’t have an emergency fund during your marriage, now is the time to start one. You don’t have to put a lot into it. Focus on adding a few dollars from every paycheck or a set monthly amount.
Life happens. If you own a home, anything from an appliance breaking down to a major construction issue can end up costing you thousands of dollars immediately. Cars need maintenance. Medical issues can arise.
While no one likes to think about these emergency situations, they can feel even more overwhelming when you don’t have the financial means to handle them. An emergency fund can help with that, offering you peace of mind when things feel chaotic.
Managing financial stress after a divorce isn’t always easy. However, as you can see, there are plenty of things you can do to rebuild your confidence as well as your finances. Keep these ideas in mind as you start the next phase of your life, and you can experience empowered financial freedom on your own.